🟣 Channel Trading Strategy 🟣

Hello, friends! 👋🏻Today I'll wanna share with You my knowledge about channel trading strategy.

❗️Channel Trading Strategy❗️ is a classic form of trading in both crypto and other markets.
This is a trend trading strategy, so accuracy and safety are very high. Today, I will present all of you about the Channel pattern and how to trade with it in the most complete and detailed way.

❓What is a Channel Pattern?❓

The Channel pattern is a development of price following the trend which consists of two parallel support and resistance levels. Prices will fluctuate and create trends along the corridor created by these two levels.

⚡️This pattern ends when the price breaks out of either the resistance or support and creates a new trend. The breakout direction is often in the opposite direction to the direction of the pattern.👇

Two Common Types of Channel Patterns

With two parallel and horizontal resistance and support levels, this is a rectangular price pattern.

Channel Up or Ascending Channel

This Channel pattern type has two parallel and upward levels of Resistance and Support. The breakout of this pattern will usually be at the support. After the breakout, the price will reverse down. In some cases, the price may retest this support.

Channel Down or Descending Channel

In contrast to the Channel Up pattern, we have the Channel Down pattern with two parallel and downward levels of resistance and support. After creating this pattern, the price usually breaks out upwards (resistance breakout) and goes up. It is possible for a strong uptrend to appear after this breakout.

Trade Effectively with the Channel Pattern

There are two types of trading using the Channel pattern: trading within the price channel and trading as per the breakout of the pattern.

💡With this type of trading, You should remember clearly: In a Channel Up, only open UP orders. Conversely, in Channel Down, you can only open DOWN orders.

How to Open an Order?

🔺 For a Channel Up: 🔺

Entry Point: When the price hits the support of the price channel.
Stop-Loss: At the previous position where the price touched the support.
Take-Profit: When the price hits the resistance.

If the previous order wins, the stop-loss of the following order will be the entry point of the previous order.

🔻 For a Channel Down: 🔻

Entry Point: When the price hits the resistance.
Stop-Loss: At the previous position where the price touched the resistance.
Take-Profit: When the price hits the support.

Trade After the Breakout

The trading strategy is based on the breakout point of the price channel. This is a very good signal of a trend reversal. You open an order as follows.

🔺 For a Channel Up: 🔺

Entry Point: When the candlestick breaks out of the support.
Stop-Loss: At the previous position where the price touched the resistance.
Take-Profit: When price re-touches the support levels it creates within the pattern.

🔻 For a Channel Down: 🔻

Entry Point: When the candlestick breaks out of the resistance.
Stop-Loss: At the previous position where the price touched the support.
Take-Profit: When price re-touches the resistance level it creates within the pattern.

The article is a bit long. However, I have covered everything I know when trading with price channels. Thank you for reading. Do you have any tips for trading with price channels? Please help me improve myself.

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Thanks for Your attention💋

Sincerely yours, Kateryna💙💛

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